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If you are the main credit cardholder, you are responsible for all the debt on the account. Learn why here.

Do you have a credit card that you and your partner use? Or maybe you have a card that you’re considering allowing your adult child use as well. Before you go ahead, it’s best to look into who is actually responsible for the debt when it comes to credit cards. Here are the facts you need to know.

Who has to pay the money back?

If you’re the main cardholder, you’re responsible for paying the money back. It doesn’t matter whether you add another cardholder or not – if the account is in your name, you will always be legally responsible for paying the money back to the lender.

This is because there’s no such thing as a joint credit card where you’re both equally responsible for the debt, as you would be with a joint loan.

If you’ve got debt on a credit card with an ex, for example, and they spent the money but the account is in your name, you will still have to pay the money back. The lender won’t stop chasing you for the money just because you didn’t personally spend it – you’re still responsible for it.

Think carefully before adding someone onto your account

It’s your decision whether or not you add someone as an additional cardholder and, as you will still be responsible for the whole debt, there are some rules about who you can add.

The additional cardholder has to be over eighteen, be a close family member and live at the same address as you. You also have to give the lender permission before they can share sensitive information about the account with the additional cardholder.

Give it careful thought before you add someone onto your account and always make sure that you’re both very clear about who will pay the money back that they spend. The worse-case scenario is that the other person runs up a huge credit card bill but neither of you can afford to pay it, and you’re completely responsible for the whole debt.

Make sure you lay some ground rules

You should only add someone as an additional cardholder to your credit card if you’re completely comfortable with the arrangement. When you add another cardholder, they will receive their own card and you should both be on the same page when it comes to how they’re allowed to use it.

Decide beforehand how much money they’re allowed to use and whether you expect them to pay that back themselves or whether you’re happy to cover everything. How you manage this might depend on the relationship you have with the additional cardholder – so whether they’re a parent, child or partner – and what they intend to use it for. You should both understand how the money is going to be repaid.

What happens if I don’t pay credit card debt?

If you’re struggling with credit card debt that you can’t pay back, there are a few things that you need to be aware of so you know the best way to deal with the situation.

First of all, credit card debt is not classed as a priority debt. Because it’s unsecured debt, the consequences of missing your payments are not as severe as missing other kinds of bills, like your council tax or rent. So if it ever came down to a choice between paying one of these bills and a credit card bill, you should always pay the priority bill first.

Of course that’s not to say that you shouldn’t try and make your payments on time. If you don’t keep up with at least the minimum payments, your creditor is likely to issue you with a default. A default means that the agreement you signed when you first opened the account is broken and they may then ask for a large amount of money back in one go. If you get a default, it’s likely that additional interest and charges will be added as well.

Further down the line, the lender may try to issue you with a County Court Judgment (CCJ). This means that the court has confirmed you owe the money and will order you to pay it back by a certain time. If you still didn’t pay it, then you may find that the lender tries to take the money straight out of your wages, benefits or send bailiffs round to your home.

Tackling the problem

Unfortunately, you will have to find a way to pay the money back that an additional cardholder borrowed. If you’re struggling to do this as well as keep on top of all your other payments, don’t ignore the problem – as we said before, the longer you leave it, the worse it will get.

Make sure you have a thorough look at your budget to see if there’s any way you’d be able to afford your credit card repayments if you cut back in other areas.

Keep in touch with the lender and make sure you explain any missed or partial payments. They might be able to work something out where you can lower your payments for a while, or take a payment holiday.

There are also debt solutions designed to help people manage their unsecured debts. It’s not always necessary to start a debt solution but in some cases, it can be the best option. To find out whether there’s a solution that would suit your circumstances, get in touch with one of our advisors using the options on the left of the page.

We hope you’ll be happy with our service but, if you’re not, we want to hear from you so we can try to put that right. Read here for information about our Complaints Procedure and about your right to refer a complaint to the Financial Ombudsman Service.

Your payments into a Debt Management Plan are protected and compensation could be available from the FSCS if there are any shortfalls in funds held on a customer's behalf.

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